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Accounting Policies of Gangotri Textile Ltd. Company

Mar 31, 2015

1. BASIS OF ACCOUNTING

The Financial statements are prepared on the basis of historical cost convention based on the accrual concept and in accordance with applicable Accounting Standards referred under section 211 (3C) of the Companies Act, 1956. The accounting is on the basis of going concern concept.

Income and expenditure are recongnized and accounted on accrual basis. Revenue for sale transaction is recognized as and when the property in the goods sold is transferred to the buyer for a definite consideration.

2. CHANGES IN ACCOUNTING POLICY

During the year ended 31st March 2013, the Revised Schedule VI notified under the Company's Act 1956, has become applicable to the Company for preparation and presentation of financial statements. The adoption of Revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statement. However, it has significant impact on the presentation and disclosure of financial statements. The company has also reclassified the previous year figurers.

3. USE OF ESTIMATES

The preparation of Financial statement requires estimates and assumption to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reported period. Difference between the actual results and estimates are recognized in the period in which results are known/materizlied.

4. INVENTORIES

Inventories are valued as under (As Furnished, valued and certified by the Management)

i)Raw Material - At Identified Cost

i) Raw Materials obsolete - At lower of identified cost or realizable value

ii) Process Stock - At Average Cost

iii) Finished Goods - At Lower of Cost or Net realizable value

iv) Waste - At Net Realisable value

v) Stores, Consumables & Spares - At Weighted Average cost

5. FIXED ASSETS

Fixed Assets are stated at cost and includes all expenditure of Capital nature including the cost of borrowings and net of Cenvat Credit wherever applicable. The preoperative expenses and the loss during that production of new units are capitalised as Fixed Assets wherever applicable.

6. DEPRECIATION

Depreciation has been provided on Straight Line Method in accordance with the rates specified under schedule XIV of the Companies Act, 1956. Depreciation on additions during the year is provided on pro- rata basis with reference to the date of installation and period of use. In respect of assets up to Rs.5000/- each, the policy of the Company is to charge 100% depreciation in the year in which such assets are installed or put to use.

7. IMPAIRMENTS OF ASSETS

The Company has internal system to access their impairment of assets. Appropriate disclosure on material impairment of losses and their treatment in profit and loss account, classes of assets and nature of impairment will be made during the period in which the impairment is recognized.

8. INVESTMENTS

Investments are meant to be long term investments and are stated at cost. Diminution in the value of investments, other than temporary in nature, are provided for.

9. EMPLOYEE RETIREMENT BENEFITS

i) Defined Benefit Plan

The Company has taken out a Master policy with LIC of India Under the "Cash Accumulation Scheme'' to cover the gratuity liabilities of the Company. The amount charged to Profit and Loss A/c is recognized at the present value of the amount payable determined using actuarial valuation techniques.

ii) Company's Contribution paid/payable during the year towards Provident Fund Scheme and Employee State Insurance are recognized in the Profit and Loss Account.

10. FOREIGN CURRENCY TRANSACTIONS

i) Transactions arising in foreign currency for import of raw materials, spares and fixed assets andfor exports during the year are converted at exchange rates prevailing on the date of transaction.

ii) Liabilities payable in foreign currencies as on the date of the Balance sheet are restated at year end exchange rate in such cases where the fluctuations results in losses or at the rates at which foreign currency forwarded covers have been obtained.Ail exchange differences arising from conversion specific borrowings and other liabilities attributable to the fixed assets, which are capitalized.

11.INTEREST ON BORROWINGS

Borrowing cost is charged to the Profit and Loss Account for the year in which is incurred except for capital assets which is capitalised till the date of assets is put to commercial use.

12. INTEREST UNDER TUF SCHEME

Certain term loans of the company have been sanctioned under the TUF scheme of the Govt., of India. Under this scheme, an interest subsidy @ 5% p.a is given by the Government on the interest paid by the company on its term loans which is refunded quarterly after TUF claim is lodged. This refund is accounted for on mercantile basis.

13. TAXES ON INCOME

a. Deferred tax is recognized, subject to consideration of prudence on all timing differences between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods. The accumulated deffered tax liability is adjusted by applying applicable tax rates under relevant tax lawas.

b. Minimum alternative Tax (MAT) credit is recognized as on asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. MAT credit becomes eligible to be recognized as an asset in accordance with the recommendation contained in the Guidance Note issued by the institute of Chartered Accountant of India, the said asset is created by way of credit to the Profit and Loss Account and shown as MAT credit entitlement. The Company reviews the same at each balances sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

14. CONTINGENT LIABILITIES

Contingent liabilities are not provided for and are disclosed by way of notes.








Mar 31, 2014

1. BASIS OF ACCOUNTING

The Financial statements are prepared on the basis of historical cost convention based on the accrual concept and in accordance with applicable Accounting Standards referred under section 211 (3C) of the Companies Act, 1956. The accounting is on the basis of going concern concept.

Income and expenditure are recongnized and accounted on accrual basis. Revenue for sale transaction is recognized as and when the property in the goods sold is transferred to the buyer for a definite consideration.

2. CHANGES IN ACCOUNTING POLICY

During the year ended 31s March 2013, the Revised Schedule VI notified under the Company''s Act 1956, has become applicable to the Company for preparation and presentation of financial statements. The adoption of Revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statement. However, it has significant impact on the presentation and disclosure of financial statements. The company has also reclassified the previous year figurers.

3. USE OF ESTIMATES

The preparation of Financial statement requires estimates and assumption to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reported period. Difference between the actual results and estimates are recognized in the period in which results are known/materizlied.

4. INVENTORIES

Inventories are valued as under (As Furnished, valued and certified

by the Management)

i)Raw Material - At Identified Cost

i)Raw Materials obsolete - At lower of identified cost or realizable value

ii) Process Stock - At Average Cost

iii) Finished Goods - At Lower of Cost or Net realizable value

iv) Waste - At Net Realisable value

v) Stores, Consumables & Spares - At Weighted Average cost

5. FIXED ASSETS

Fixed Assets are stated at cost and includes all expenditure of Capital nature including the cost of borrowings and net of Cenvat Credit wherever applicable. The preoperative expenses and the loss during that production of new units are capitalised as Fixed Assets wherever applicable.

6. DEPRECIATION

Depreciation has been provided on Straight Line Method in accordance with the rates specified under schedule XIV of the Companies Act, 1956. Depreciation on additions during the year is provided on pro- rata basis with reference to the date of installation and period of use. In respect of assets up to Rs.5000/- each, the policy of the Company is to charge 100% depreciation in the year in which such assets are installed or put to use.

7. IMPAIRMENTS OF ASSETS

The Company has internal system to access their impairment of assets. Appropriate disclosure on material impairment of losses and their treatment in profit and loss account, classes of assets and nature of impairment will be made during the period in which the impairment is recognized.

8. INVESTMENTS

Investments are meant to be long term investments and are stated at cost. Diminution in the value of investments, other than temporary in nature, are provided for.

9. EMPLOYEE RETIREMENT BENEFITS i) Defined Benefit Plan

The Company has taken out a Master policy with LIC of India Under the "Cash Accumulation Scheme" to cover the gratuity liabilities of the Company. The amount charged to Profit and Loss A/c is recognized at the present value of the amount payable determined using actuarial valuation techniques.

ii) Company''s Contribution paid/payable during the year towards Provident Fund Scheme and Employee State Insurance are recognized in the Profit and Loss Account.

10. FOREIGN CURRENCY TRANSACTIONS

i) Transactions arising in foreign currency for import of raw materials, spares and fixed assets and for exports during the year are converted at exchange rates prevailing on the date of transaction.

ii) Liabilities payable in foreign currencies as on the date of the Balance sheet are restated at year end exchange rate in such cases where the fluctuations results in losses or at the rates at which foreign currency forwarded covers have been obtained.AII exchange differences arising from conversion specific borrowings and other liabilities attributable to the fixed assets, which are capitalized.

11.INTEREST ON BORROWINGS

Borrowing cost is charged to the Profit and Loss Account for the year in which is incurred except for capital assets which is capitalised till the date of assets is put to commercial use.

12. INTEREST UNDER TUF SCHEME

Certain term loans of the company have been sanctioned under the TUF scheme of the Govt., of India. Under this scheme, an interest subsidy @ 5% p.a is given by the Government on the interest paid by the company on its term loans which is refunded quarterly after TUF claim is lodged. This refund is accounted for on mercantile basis.

13. TAXES ON INCOME

a. Deferred tax is recognized, subject to consideration of prudence on all timing differences between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods. The accumulated deffered tax liability is adjusted by applying applicable tax rates under relevant tax lawas.

b. Minimum alternative Tax (MAT) credit is recognized as on asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. MAT credit becomes eligible to be recognized as an asset in accordance with the recommendation contained in the Guidance Note issued by the institute of Chartered Accountant of India, the said asset is created by way of credit to the Profit and Loss Account and shown as MAT credit entitlement. The Company reviews the same at each balances sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

14. CONTINGENT LIABILITIES

Contingent liabilities are not provided for and are disclosed by way of notes.


Mar 31, 2013

1. BASIS OF ACCOUNTING

The Financial statements are prepared on the basis of historical cost convention based on the accrual concept and in accordance with applicable Accounting Standards referred under section 211 (3C) of the Companies Act, 1956. The accounting is on the basis of going concern concept.

Income and expenditure are recognized and accounted on accrual basis. Revenue for sale transaction is recognized as and when the property in the goods sold is transferred to the buyer for a definite consideration.

2. CHANGES IN ACCOUNT ING POLICY

During the year ended 31s March 2013, the Revised Schedule VI notified under the Company''s Act 1956, has become applicable to the Company for preparation and presentation of financial statements. The adoption of Revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statement. However, it has significant impact on the presentation and disclosure of financial statements. The company has also reclassified the previous year figurers.

3. USE OF ESTIMATES

The preparation of Financial statement requires estimates and assumption to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reported period. Difference between the actual results and estimates are recognized in the period in which results are known/materialized.

4. INVENTORIES

Inventories are valued as under (As Furnished, valued and certified by the Management)

i)Raw Material - At Identified Cost

i)Raw Materials obsolete - At lower of identified cost or realizable value

ii) Process Stock - At Average Cost

iii) Finished Goods - At Lower of Cost or Net realizable value

iv) Waste - At Net Realizable value

v) Stores, Consumables & Spares - At Weighted Average cost

5. FIXED ASSETS

Fixed Assets are stated at cost and includes all expenditure of Capital nature including the cost of borrowings and net of Convert Credit wherever applicable. The preoperative expenses and the loss during that production of new units are capitalized as Fixed Assets wherever applicable.

6. DEPRECIATION

Depreciation has been provided on Straight Line Method in accordance with the rates specified under schedule XIV of the Companies Act, 1956. Depreciation on additions during the year is provided on prorata basis with reference to the date of installation and period of use. In respect of assets up to Rs.5000/- each, the policy of the Company is to charge 100% depreciation in the year in which such assets are installed or put to use.

7. IMPAIRMENTS OF ASSETS

The Company has internal system to access their impairment of assets. Appropriate disclosure on material impairment of losses and their treatment in profit and loss account, classes of assets and nature of impairment will be made during the period in which the impairment is recognized.

8. INVESTMENTS

Investments are meant to be long term investments and are stated at cost. Diminution in the value of investments, other than temporary in nature, are provided for.

9. EMPLOYEE RETIREMENT BENEFITS

i) Defined Benefit Plan

The Company has taken out a Master policy with LIC of India Under the "Cash Accumulation Scheme" to cover the gratuity liabilities of the Company. The amount charged to Profit and Loss A/c is recognized at the present value of the amount payable determined using actuarial valuation techniques.

ii) Company''s Contribution paid/payable during the year towards Provident Fund Scheme and Employee State Insurance are recognized in the Profit and Loss Account.

10. FOREIGN CURRENCY TRANSACTIONS

i) Transactions arising in foreign currency for import of raw materials, spares and fixed assets and for exports during the year are converted at exchange rates prevailing on the date of transaction.

ii) Liabilities payable in foreign currencies as on the date of the Balance sheet are restated at year end exchange rate in such cases where the fluctuations results in losses or at the rates at which foreign currency forwarded covers have been obtained. All exchange differences arising from conversion specific borrowings and other liabilities attributable to the fixed assets, which are capitalized.

11.INTEREST ON BORROWINGS

Borrowing cost is charge to the Profit and Loss Account for the year in which is incurred except for capital assets which is capitalized till the date of assets is put to commercial use.

12. INTEREST UNDER TUF SCHEME

Certain term loans of the company have been sanctioned under the TUF scheme of the Govt., of India. Under this scheme, an interest subsidy @ 5% p.a is given by the Government on the interest paid by the company on its term loans which is refunded quarterly after TUF claim is lodged. This refund is accounted for on mercantile basis.

13. TAXES ON INCOME

a. Deferred tax is recognized, subject to consideration of prudence on all timing differences between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods. The accumulated differed tax liability is adjusted by applying applicable tax rates under relevant tax lawas.

b. Minimum alternative Tax (MAT) credit is recognized as on asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. MAT credit becomes eligible to be recognized as an asset in accordance with the recommendation contained in the Guidance Note issued by the institute of Chartered Accountant of India, the said asset is created by way of credit to the Profit and Loss Account and shown as MAT credit entitlement. The Company reviews the same at each balances sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

14. CONTINGENT LIABILITIES

Contingent liabilities are not provided for and are disclosed by way of notes.


Mar 31, 2010

1. BASIS OF ACCOUNTING

i) The financial statements are prepared on the basis of historical cost convention based on the accrual concept and in accordance with applicable Accounting Standards referred under Section 211 (3C) of the Companies Act, 1956. The accounting is on the basis of going concern concept.

ii) Income and expenditure are recongnized and accounted on accrual basis. Revenue for sale transaction is recognized as and when the property in the goods sold is transferred to the buyer for a definite consideration.

2. USE OF ESTIMATES

The preparation of financial statement requires estimates and assumptions to be made that affect the reported amount of assets and liabilites on the date of the financial statements and the reported amount of revenues and expenses during the reported period. Difference between the actual results and estimates are recognised in the period in which results are known/materialised.

3. INVENTORIES

Inventories are valued as under

(As Furnished, valued and certified by the Management) i) a. Raw Materials - At Identified Cost

i) b. Raw Materials obsolete - At lower of identified

cost or Realisable value

ii) Process Stock - At Average Cost

iii) Finished goods - At Lower of Cost or Net

Realisable Value iv) Waste - At Net Realisable Value

v) Stores, Consumables and - At Weighted Average Spares

Cost

4. FIXED ASSETS

Fixed Assets are stated at cost and includes all expenditure of capital nature including the cost of borrowings and net of Cenvat credit wherever applicable. The preoperative expenses and the loss during trial production of new units are capitalised as Fixed Assets wherever applicable.

5. DEPRECIATION

Depreciation has been provided on Straight Line Method in accordance with the rates specified under schedule XIV of the Companies Act, 1956. Depreciation on additions during the year is provided on pro-rata basis with reference to the date of installation and period of use. In respect of assets upto Rs. 5000/- each, the policy of the Company is to charge 100% depreciation in the year in which such assets are installed or put to use.

6. IMPAIRMENTS OF ASSETS

The Company has internal system to access their impairment of assets. Appropriate disclosure on material impairment of losses and their treatment in Profit & Loss Account, classes of assets and nature of impairment will be made in the year in which the impairment is recognised.

7. INVESTMENTS

Investments are meant to be long term investments and are stated at cost. Diminution in the value of investments, other than temporary in nature, are provided for.

8. EMPLOYEE RETIREMENT BENEFITS

a. Defined Benefit Plan

The Company has taken out a Master policy with LIC of India under the "Cash Accumulation Scheme" to cover the gratuity liabilities of the Company. The premium paid / payable to LIC on the said policy is charged to Profit & Loss Account of the year.

b. Defined Contribution Plan

Companys Contribution paid/paybale during the year towards Provident Fund Scheme and Employee State Insurance are recognized in the Profit and Loss Account.

9. FOREIGN CURRENCY TRANSACTIONS

i) Transactions arising in foreign currency for import of raw materials, spares and fixed assets and for exports during the year are converted at exchange rates prevailing on the date of transaction.

ii) Liabilities payable in foreign currencies as on the date of the Balance Sheet are restated at year end exchange rates in such cases where the fluctuations result in losses or at the rates at which foreign currency forward covers have been obtained. All exchange differences arising from conversion are included in the Profit and Loss Account except relating to specific borrowings and other liabilities attributable to the fixed assets, which are capitalised.

10. INTEREST ON BORROWINGS

Borrowing cost is charged to the Profit and Loss Account for the year in which it is incurred except for capital assets which is capitalised till the date the asset is put to commercial use.

11. INTEREST UNDER TUF SCHEME

Certain term loans of the company has been sanctioned under the TUF scheme of the Govt, of India. Under this scheme, interest subsidy @5% p.a. is given by the Government on the interest paid by the company on its term loans which is refunded quarterly after TUF claim is lodged. This refund is accounted for on merchantile basis and is treated as revenue receipt except in such cases where the lending bankers have not lodged any claim or having lodged, have not received any amount towards claim, considering that our company is under CDR package, wherein a holiday period for interest payment to lenders has been sanctioned.

12. TAXES ON INCOME

Deferred tax is recognized, subject to consideration of prudence on all timing differences between taxable income and accounting income that originate in one period and are capable of being reversed in one or more subsequent periods. The accumulated deferred tax liability is adjusted by applying applicable tax rates under relevent tax laws.

13. MISCELLANEOUS EXPENDITURE

Preliminary and Public Issue expenses are amortised over a period of 10 years.

14. CONTINGENT LIABILITIES

Contingent liabilities are not provided for and are disclosed by way of notes.

15. INCOME-TAX

Minimum Alternative Tax(MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. MAT credit becomes eligibile to be recognized as an asset in accordance with the recommendation contained in the Guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of credit to the Profit and Loss Account and shown as MAT credit entitlement. The Company reviews the same at each balance sheet date and writes down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal income tax during the specified period.

16. GOVERNMENT GRANTS - CAPITAL SUBSIDY

In respect of Capital Subsidy on Specific Machinery from Government, the Company has opted the second option spelt out in AS 12 - Accounting for Government Grants, which is the "Income Approach" due to which the income is recognised in the Profit & Loss Account. The above subisdy is recognised as income equally over 10 years being the period fixed by the Board of Directors as the life of the Specific Asset. Balance is being treated as Deffered Income .

 
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